Auctioneers raided the home of a Presbyterian Church of East Africa (PCEA) reverend in Marururui, Nairobi on Thursday, February 23, to recover a Ksh7 million loan.
The officials hired by a creditor accused the clergy of defaulting on a Ksh5 million loan secured in 2019.
Following his default, the auctioneers sought a court order to recover their money after a back-and-forth with the debtor.
"He guaranteed some money up to the tune of Ksh5 million, but he failed to honour his obligation of repaying those loans after he had guaranteed," one of the lead auctioneers stated.
"So we went back to court and got orders that he should pay that money plus the interest that comes to around ksh7 million," he added.
After being granted the green light to proceed with the recovery, the auctioneers informed the clergy of their intention to enforce the order.
"We managed to proclaim some household items, and some motor vehicles, and very soon will proceed with the sale of the items,"
"Today we have secured a very big victory for our clients, who were guarantors of the reverend," the auctioneers stated.
According to the latest data released by the Central Bank of Kenya (CBK), loan default surged to 16% in August 2023 amidst an increase in the cost of living.
This translated to Ksh596 billion in defaults, forcing the banking sector to increase interest rates to cushion themselves from attracting defaulters.
CBK further highlighted that most of the defaulted loans were across the mining, manufacturing, real estate and building and construction sectors.
Over the last two months, auctioneers also increased their recovery rate judging by the newspaper pages dominated by auction adverts.
Most of the property on sale were mansions, cars, and parcels of land countrywide.
